business news in context, analysis with attitude

  • Wal-Mart CEO Lee Scott said yesterday that the US Congress should consider an increase in the national minimum wage. However, as the Wall Street Journal reports this morning, “though Wal-Mart pays above the current $5.15 an hour minimum wage -- the average hourly wage among its 1.3 million U.S. workers is just under $10 an hour -- some of its smaller competitors don't pay as much. As a result, a boost in the minimum wage could pressure the profitability of Wal-Mart competitors.

    Still, it was somewhat ironic that a company often criticized for paying its people badly would urge that the national wage be increased, as opposed to just raising wages internally.

    “We simply believe it is time for Congress to take a look at the minimum wage and other legislation that can help working families," Scott said, noting that these working families are often Wal-Mart customers who are having trouble affording even Wal-Mart’s low prices.

  • Wal-Mart has announced that it will open between 555 and 600 new stores in the coming year – between 270 and 280 new supercenters, between 20 and 390 new discount stores, as many as 10 new Sam’s Clubs and five new Neighborhood Market grocery stores. About 215 of the new stores will be expansions or relocations of existing units.

  • As many as 370 of the new stores will be in the US.

  • Wal-Mart CEO Lee Scott is expected to announce today what the New York Times calls “a set of sweeping, specific environmental goals to reduce energy use in its stores, double its trucks' fuel efficiency, minimize its use of packaging and pressure thousands of companies in its worldwide supply chain to follow its lead.”

    "As one of the largest companies in the world, with an expanding global presence, environmental problems are our problems,” Scott said in a speech yesterday. The NYT reports that Wal-Mart will invest a half-billion dollars in technologies “that will reduce greenhouse gases from stores and distribution centers by 20 percent over the next seven years; increase the fuel efficiency of the truck fleet by 25 percent over the next three years and double it within 10 years, and design a new store within four years that is at least 25 percent more energy efficient.”

  • Wal-Mart’s Asda Group in the UK announced that it will reinstate a 20 percent discount for its 140,000 employees purchasing beer, wine, spirits, toys, CDs and DVDs from its stores. The company had planned to only give its employees a 10 percent discount on big ticket items, but CEO Andy Bond has been dealing with an embarrassing report recently noting that many of his employees are shopping elsewhere – which may have prompted him to do more to keep his employees’ money all in the family.

KC's View:
Lee Scott said something interesting yesterday, that it was critical for Wal-Mart to make these kinds of changes if it is to become a 21st century company.

He is, to be sure, absolutely right.

If you’re going to take over the world, you actually then have some responsibility for the world.

Some of this, of course, is public relations. Really, really good public relations.

And not that there’s anything wrong with that.